Wednesday, May 21, 2014

State audit slams top-heavy JCPS bureaucracy

Jefferson County Public Schools has a top-heavy bureaucracy, with too
many administrators who are paid too much — robbing resources that
could be used for classroom instruction, a major state audit has found.

JCPS Supt Donna Hargens

A
260-page report released Wednesday by state Auditor Adam Edelen found
that the school district pays 369 administrators more than $100,000 a
year —more than the 281 in Kentucky's entire executive branch.

Comparing
Jefferson County with five similar school districts across the United
States, the audit found that Jefferson County spent the least on
instruction and the most on administrative costs. The district also had
the lowest percentage of employees who were teachers — 43 percent — and
the highest percent of administrators, at nearly 10 percent.

The
audit also found that the district board members do not generally have
the "depth of understanding required to actively examine or question the
budget effectively without significant reliance on JCPS staff," which
it said is "not conducive for proper oversight."

"This report
paints a picture of a bureaucracy that benefits itself and keeps the
board in the dark rather than supports excellence in the classroom and a
public mission of transparency and accountability," Edelen said in a
statement.

In a written response, Superintendent Donna Hargens
said the district had already taken a number of steps recommended by the
audit, including freezing central office staff and administrative
salaries in 2012-13, increasing instructional spending, starting a
review of policies and plans to revamp internal auditing.

"Your
recommendations will better our operations," Hargens wrote, noting the
board will provide a full response within 60 days and present the board
with a plan to implement changes.

School board member Debbie Wesslund said the board has been "focused relentlessly on improvement."

"We
have invested in multiple audits over the past few years, and they have
helped the administration streamline significantly and target resources
to schools," she said. "The key is that they have been constructive and
supportive of our school system, building us up. An attitude of support
is key to our success."

In the office's largest review, Edelen's
staffers had spent much of the last year examining the administration of
state's largest school system, which serves more than 100,000 students
on a budget of nearly $1.2 billion.

Conducted
at the request of the Jefferson County Board of Education at a cost of
roughly $125,000, the review covering 2011 to 2013 wasn't meant to focus
on any allegations of "waste, fraud and abuse" or on individual
schools, Edelen said, and no criminal wrongdoing was uncovered.

Instead,
the audit focused on the district's central office and administration,
in part by comparing it with similar school districts in Austin, Texas;
Baltimore County; Charlotte-Mecklenburg, N.C.; Cobb County, Ga.; and
Pinellas County, Fla.

The report said one of JCPS' weaknesses was that the district failed to test itself against its peers.

The
audit makes 45 findings and 200 recommendations in areas such as
spending, policies internal auditing, contracting and board oversight.

It
found JCPS ranks at or near the bottom in categories involving teacher
staffing and expenditures for instruction, while ranking highest in the
categories of school administrators, support staff, and instructional
aides.

The district had the second-highest student to teacher
ratio, and ranked the lowest in instruction spending, at 53 percent of
its budget (four of the other five were 60 percent or higher), while
ranking highest in administration and operations spending, at 31 percent
of its budget.

"The number of school administrators and support
staff as a percentage of total staff is nearly double the rate of one of
the benchmark districts," Edelen said in a statement. "That indicates
that much of the administrative bloat exists at the school level, not in
the central office."

In comparison to three peer districts, JCPS
central department employees are paid a higher average salary and have
more employees, earning over $100,000 annually. Employees working for
the central departments exceeded the next highest average at Cobb County
School District by $5,866 and the lowest reported average at
Charlotte-Mecklenburg by $18,551.

It also found that JCPS students
face more restrictions on access to textbooks and other classroom
resources than many other Kentucky districts. Compared with its peer
districts, and had the lowest textbook budget — mostly because the state
provides no funds. More than half of teachers said students couldn't
take home textbooks.

In addition, central office provides on
limited monitoring of textbook funding, decided by individual schools —
which get textbook funds of $20 per elementary and middle school
student, and $40 per high school student.

Nearly half of teachers
surveyed said their school provided inadequate instructional resources
for all students, according to a survey of more than 1,500 of the
district's 6,400 teachers. Partly as a result, more than 90 percent of
teachers spent personal funds to supplement classroom resources.

"Most
spend hundreds of dollars a year," Edelen said in a release. "A teacher
should have the prerogative to use personal resources for the
classroom, but no teachers should feel they have to due to a lack of
funding."

When it comes to governance, the audit found that Board
of Education members generally lack "a depth of understanding" to
question the budget effectively without significant reliance on JCPS
staff, the report found.

Edelen noted that some board members
admitted to not knowing what some budget line items really meant, and
were not regularly revisiting the actual spending in comparison to the
budget.

It also lacks a committee structure to provide a detailed
level of oversight of financial and audit matters. The audit recommends
adding two "at large" board members to the seven-member group, along
with better training for board members and creating a budget
subcommittee.

"The Board that may be too small to effectively
oversee the District's finances and operations," the report said, noting
that he board "has not actively examined or questioned staff" in budget
matters.

The audit also found a lack of monitoring and oversight
from the central office of district contracts, which numbered over 1,700
during the review period. The district does not maintain a central
database of those contracts. Edelen called it "unacceptable."

Auditors
also identified contracts that are allowed to renew an unlimited number
of times without reporting to the Board, including some as high as
$146,000. Instances also were noted of payments made for invoices and
construction change orders that did not comply with contract terms or
lacked required supporting documentation, the report said.

"The
practice of unlimited renewal opportunities for public contracts,
coupled with the practice of non-periodic reporting of these renewals or
continued contracts to the Board in a public open meeting of the Board
does not lend itself to transparency and good public governance," the
report said.

Further, it found poor documentation and lax
oversight led to $5,561 in over-payments for capital construction change
orders. The district spent $154 million on capital projects in the
review period.

Edelen's report says the district could save $3
million a year by scrapping a costly and outdated system of six
centralized warehouses that act as an unnecessary middle man in getting
supplies to schools. Instead, a vendor could deliver such supplies at a
cost savings, the report said.

The audit also took issue with a
range of policies governing spending by employees, including purchasing
card purchases that didn't have easy-to-access supporting documentation,
and travel reimbursement guidelines were vague and lead to
inconsistencies.

While a review of 287 travel reimbursements found
most had proper approvals and documentation, some charges "seemed to
accommodate personal comfort" such as extra leg-room fees and valet
parking charges.

In addition, JCPS has not developed written
procedures documenting the assignment process and allowable usage of
JCPS owned vehicles taken home by staff, nor did it have a proper
procedure for assigning phones.

But oversight is lacking in some
areas. For example, the internal auditors - who examine school activity
funds, attendance and other areas - report to the superintendent, and
not the school board, as Edelen recommends. The audit also found
inadequate policies to "to investigate, monitor, or report hotline
complaints."

"No serious abuses or waste were found at the central
level, but it doesn't mean it didn't occur in the past or that it
couldn't occur in the future," Edelen said. "When you don't have
adequate and consistent controls over things like travel, credit cards,
leave time, take-home cars and cell phones you are increasing that
risk."

More than a dozen findings centered around information
technology, including those involving "security vulnerabilities and
describe a situation where students and employees may be potentially
exposed to the inadvertent loss or intentional theft of private,
confidential data."

Edelen has conducted audits in a number of
other school districts as Dayton Independent, where the former
superintendent was found have received $224,000 in unauthorized benefits
and payments. Other audits found excessive travel and resulted in
resignations.

In 2012, auditors hired by the JCPS board found
problems including inadequate curriculum at middle and high schools but
called the district fiscally sound. Experts who conducted an
organizational review in 2011 said they found problems such as overpaid
administrators.

Hargens has since reorganized district administration.

Edelen
said the 200 recommendations in his audit could save taxpayers tens of
millions of dollars, reduce the risk for fraud and abuse and increase
transparency.

In a statement, JCPS Board Chairwoman Diane Porter
said the review would "further empowers this board to confidently guide
JCPS on its road to becoming the best urban school district in the
country."

3 comments:

Anonymous
said...

I see alot of similarities with our federal government.

On the other hand, I am not sure if we can fault an apple for being two sweet or sour compared to a banana or orange just because they happend to each weight the same. I am sure that GA, TX, FL and NC each have their own unique fiscal, regulatory and instructional conditions which may not be similar to KY.

Though not intended as an excuse, I would suggest that recent KY expectations to increase student performance through various documentation and report production have resulted in greater administrative responsibilities and duties.

One of the recommendations that I believe would work for FCPS would be to increase the size of the board by 2 members. This would increase the size of diversity on the school board. FCPS school board districts are very large and the members have many schools in those districts. Also, central office has gotten too big and too complex.

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